Opt-in plaintiffs who filed consents remain parties after conditional certification denied in FLSA collective action
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Monday, April 23, 2018

Opt-in plaintiffs who filed consents remain parties after conditional certification denied in FLSA collective action

By Ronald Miller, J.D.

In “a question of first impression in every circuit,” the Eleventh Circuit ruled that individuals who opt into collective actions under the FLSA need only file a written consent to become a named party to the case. After first holding that it had jurisdiction to entertain the opt-in plaintiffs’ appeal, and that they timely appealed the judgment of a district court, the appeals court ruled that employees who opted into a collective action were not automatically dismissed from the case when the district court denied the named plaintiff’s motion for conditional certification (Mickles v. Country Club, Inc. dba Goldrush Showbar, April 18, 2018, Black, S.).

In April 2014, an employee filed suit against her employer alleging that she and other similarly-situated employees were improperly classified as independent contractors, so that the employer failed to compensate them the minimum wage and for overtime work. Other employees opted into the litigation by filing consents to become party plaintiffs. Discovery began and the parties set a discovery deadline, which the trial court adopted.

The employer took depositions from the opt-in plaintiffs during the discovery period. More than a month after the close of discovery, the named plaintiff filed a motion for conditional certification of a collective action. The district court denied the motion based on untimeliness, as the motion was filed “nearly eight months” past the deadline set by local rules, and the named plaintiff did not have “prior permission of the court” to file the motion after the deadline.

Motion for clarification. On October 6, 2016, the employer filed a motion for clarification of the district court’s conditional certification order, inquiring about which individual plaintiffs remained parties in the action. The named plaintiff and each of the three opt-in plaintiffs believed they were party plaintiffs in the action because the district court never dismissed their claims. For its part, the employer argued that the opt-in plaintiffs never formally became party plaintiffs, and that they effectively fell out of the case when the motion for conditional certification was denied, leaving only the named plaintiff as a party plaintiff. The employees, however, disagreed that denial of the motion for conditional certification caused the opt-in plaintiffs to be automatically dismissed from the case.

In granting the employer’s motion for clarification, the district court concluded that the opt-in plaintiffs were never adjudicated to be similarly situated to the named plaintiff, and therefore were never properly added as party plaintiffs to the collective action. Thereafter, the named plaintiff settled with the employer. The opt-in plaintiffs appealed the district court’s orders.

Parties to litigation. As an initial matter, the appeals court asked the parties to address: (1) whether the opt-in plaintiffs were considered parties such that they had a right to appeal; and (2) if so, whether their appeal was timely as to the orders that foreclosed their rights to participate in the litigation. Did the district court err in determining that the opt-in plaintiffs “never became parties” to the litigation?

After reviewing the typical process in an FLSA collective action, the appeals court noted that under 29 U.S.C. § 216(b), a plaintiff “must affirmatively opt into the action by filing written consent with the court in order to be considered a class member and be bound by the outcome of the action.” The court discerned two requirements under the collective action statute: (1) a named plaintiff; and (2) an opt-in plaintiff must give consent in writing to become a party to the action.

Similarly situated determination. In this case, there was no dispute that the opt-in plaintiffs satisfied the second requirement, as each consented in writing to become opt-in plaintiffs. However, the employer argued that the first requirement was not satisfied because the opt-ins were never found to be similarly situated to the named plaintiff.

Because the district court determined that the named plaintiff’s motion for conditional certification was untimely, it never made a similarly situated determination at either the lenient “notice stage,” or the more demanding decertification stage. As a consequence, the appeals court was faced with the question of what was the status of opt-in plaintiffs who filed written consents before the motion for conditional certification was filed.

The appeals court concluded that the plain language of Section 216(b) supports the conclusion that those who opt in become party plaintiffs upon the filing of a consent and nothing further, including conditional certification, is required. Thus, the opt-in plaintiffs were parties to this litigation and could appeal adverse judgments against them.

Appealable order. Further, the court found that the only appealable order was the district court’s order approving the settlement between the named plaintiff and the employer. While they were not bound by the order approving the settlement, the entry of that judgment marked the first time they could appeal the two orders they were bound by: (1) the order denying conditional certification; and (2) the clarification order. Accordingly, the appeals court was satisfied that it had jurisdiction to hear this appeal.

As to the denial of the motion for conditional certification, the appeals court ruled that the district court did not abuse its discretion in denying the motion as untimely, since it was filed approximately eight months after it was due. The evidence did not support the opt-in plaintiffs’ contention that the district court had granted permission to file the motion late.

Clarification order. The appeals court agreed with the opt-in plaintiffs that the district court’s deeming them non-parties in the clarification order was tantamount to dismissing them with prejudice. Generally, when conditional certification of a collective action is denied, existing opt-in plaintiffs are dismissed without prejudice and the matter proceeds on the named plaintiff’s individual claims. Because the opt-in plaintiffs were parties to this litigation upon filing consents, the district court erred in deeming them non-parties in the clarification order, which had the effect of dismissing their claims with prejudice.

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